If your employer is requesting that you sign a non-compete, is taking action against you for an alleged violation, or you are considering a new job, you may be wondering, “Are non-compete agreements enforceable in Texas?” While these agreements are enforceable, they may not be legally valid in certain situations.
An Overview of Non-Competes in Texas
Non-compete agreements are among the most common types of employment agreements, restricting an employee’s ability to work for a competitor. These agreements can have a legitimate business purpose, allowing companies to retain company ideas, assets, and clients. However, they do have the potential to cause employees frustration, confusion, and even hardship when it comes to finding a new job.
Non-competes are one of the most common elements of an employment contract and are used by many different employers throughout Texas. About 30 million American workers are bound by a non-compete agreement, which is about 11.4% of the workforce. Even if they are not currently bound by one of these agreements, 38% of employees have agreed to a non-compete in the past.
When Are Non-Competes Enforceable?
Under Texas non-compete laws, there are several requirements for non-compete agreements. These restrictions prevent employers from forcing employees to adhere to unreasonable restrictions. For a non-compete agreement to be enforceable, it must be:
- Applicable only to a specific and reasonable time and geographic scope. A non-compete should name the specific geographical area in which it applies, such as the city you work in or within a certain radius of a company. There should also be a time period during which the non-compete applies, such as one to two years after working for an employer.
- Applicable only to specific and reasonable activities. A non-compete should not place broad limits on your employment. An employer should name certain roles or responsibilities that must be avoided, within the geographical and time limits set.
- Part of a broader, legal employment agreement. An employer should not offer you a non-compete unless it is part of an otherwise enforceable agreement. Typically, this other agreement is an employment contract or a severance agreement, though other types of agreements may be sufficient to meet this requirement.
- Providing something of value for the employee. A non-compete offers protection to the company. Because of this, Texas non-compete laws require employers to provide something of value, known as consideration, to the employee. This often happens through the broader employment agreement, where the employer is offering employment, access to trade secrets, specialized training, or severance pay.
The requirements for a valid non-compete are not impacted by who you work for. Whether you work for Texas A&M, Toyota, Amazon, or another employer, you have the legal protections against unfair non-competes.
If all of these requirements are met, a non-compete is most likely legally enforceable. However, if you are uncertain or believe that an agreement does not meet one or more of these requirements, you should hire a non-compete lawyer to help you analyze the agreement and determine your next steps.
Hire a Non-Compete Lawyer From Massey Law
Massey Law is an experienced firm in Houston, Texas, that handles business litigation cases, including non-compete litigation cases. Founding attorney Dwaine Massey has handled over 25 cases that were resolved by a jury verdict, as well as dozens of cases resolved through arbitration. He has worked in law since 1994 and is Board Certified in Civil Trial Law, an achievement that applies to less than five percent of all Texas Lawyers.
Attorney Dwaine Massey is frequently recognized for his knowledge of Texas business and employment law, and his commitment to providing fair and strategic representation for his clients. He received an AV Preeminent rating from Martindale-Hubbell, their highest peer-reviewed rating, and is also the President-Elect of the Texas Association of Civil Trial and Appellate Specialists.
However, awards and recognition are not guarantees of future results. Selection criteria vary by organization.
FAQs
Can I Work for a Competitor If I Signed a Non-Compete in Texas?
No, you generally cannot work for a competitor in Texas if you signed a non-compete agreement. However, if the competitor is outside of the geographic area or exact type of work, the non-compete may no longer apply. Furthermore, if the timeframe outlined in the non-compete has expired, it is no longer valid. Carefully reviewing the exact terms of the agreement can help you determine whether a new position may cause a violation.
Do Non-Competes Still Hold Up in Texas?
Yes, non-competes do still hold up in Texas, so long as they follow the state’s strict legal standards. Non-competes hold up as long as they are reasonable in time, geographic scope, and type of work, are tied to a broader enforceable agreement, and provide valid consideration for the employee. If you suspect that one of these requirements is not met, you should speak with a non-compete attorney about whether the agreement is still enforceable.
What Voids a Non-Compete Agreement?
There are several reasons that a non-compete is void, such as if the restrictions are too broad in scope, there is no legitimate business interest for having the non-compete, if the non-compete causes undue hardship for the employee, if there is no benefit to the employee for signing the non-compete, or if the agreement violates other non-compete or contract laws.
How to Get Around a Non-Compete in Texas?
In Texas, you can get around a non-compete agreement by proving that the contract is legally unenforceable or potentially by negotiating a release with your employer. Finding legal errors may involve arguing that the terms are overly broad or unreasonable, or that the agreement does not give you something valuable as an employee. Negotiating your way out of an agreement can be possible even if there are no legal issues, but it is not always successful.
Learn How a Skilled Non-Compete Attorney From Massey Law Can Help
While Texas law does uphold an employer’s right to use non-competes as a way to protect legitimate business interests, this does not always mean that an agreement is created in such a way as to be enforceable. If you believe that a non-compete is unfair, such as being overly broad or not providing any benefit, Contact Massey Law for guidance.
